Monday, February 20, 2006

Tony's Crony? Berlusconi!

HOLIDAYS for Tony Blair and his family, and alleged cash gifts for the partner of one of his ministers. Italian prime minister and media tycoon Silvio Berlusconi is a generous man.At least, he is to his friends.

David Mills, lawyer husband of Britain's Culture Secretary Tessa Jowell, was a witness in the Italian premier's trial for allegedly giving bribes and secret politicaldonations.

A report in the Observer on Sunday, February 19 says Mills has admitted in a letter that he avoided telling the full truth about Berlusconi, to keep the media tycoon out of a 'great deal of trouble'. Mills later received a £350,000 'gift' allegedly linked to a senior executive working for Berlusconi's media organisation.

The letter, obtained by The Observer, was written by Mills on 2 February, 2004, and sent to his London accountant. Mills, who was Berlusconi's legal adviser, wrote: 'I kept in close touch with the B [Berlusconi] people... they also knew quite how much the way in which I had been able to give my evidence (I told no lies, but I turned some very tricky corners, to put it mildly) had kept Mr B out of a great deal of trouble I would have landed him in if I had said all I knew.'

The letter was uncovered by Italian prosecutors who are set to charge Mills with corruption in connection with the alleged £350,000 payment. They allege the payment to Mills was made by Berlusconi as a bribe to give false evidence at the earlier trials - a claim that both Mills and Berlusconi have always strenuously refuted. Mills has always denied receiving the money from Berlusconi or anybody connected with the Italian leader, claiming that it came from another client.

Yet the letter has been described as the 'smoking gun' in Italy because Mills appears to be admitting receiving the money from Berlusconi for his help. Mills's letter to his accountant, Bob Drennan at Rawlinson & Hunter, states:'At around the end of 1999, I was told I would receive money, which I could treat as a long-term loan or a gift. $600,000 was put in a hedge fund and I was told it would be there if I needed it. (It was put in the fund because the person connected to the [Berlusconi] organisation was someone I had discussed this fund with on many occasions, and it was a roundabout way of making the money available.)

'For obvious reasons of their own (I was at that stage still a prosecution witness, but my evidence had been given), it needed to be donediscreetly.'

Mills added: 'I regarded the payment as a gift. What else could it be? I wasn't employed, I wasn't acting for them, I wasn't doing anything for them, I had already given my evidence, but there was certainly the risk of future legal costs... and a great deal of anxiety.'

The Observer says Mills confirmed the letter was genuine, but insisted he was innocent of all charges and that he was a 'pawn' in a politically inspired witchhunt ahead of the Italian election. He insists he has given prosecutors 'absolute proof' the money was not from Berlusconi or anybody connected with him. He said: 'My own private papers have been intercepted and grossly and maliciously misinterpreted by people with a motive to do it. I come back to the simple fact: these magistrates are accusing Berlusconi of corrupting me. They have to prove he paid me money and I received it... they know for a certain fact that that money did not come from anyone who had anything to do with Berlusconi.

Mills has acted for Berlusconi for more than twenty years, helping the billionaire TV and newspaper owner set up a chain of companies in places like the British Virgin islands to avoid millions of pounds in tax, and to get around restrictions on ownership of TV channels. Over the past six years he has given evidence in a series of fraud investigations.

At one stage Mills became owner of one of Berlusconi's channels through a Virgin Islands company called Horizon. The channel was eventually sold off, and Mills' law firm received £2 million.

Mills' partner Tessa Jowell, has had a say as Culture Secretary in bringing the BBC into line with policy, but also championed a Communications Bill, to allow greater foreign ownership of British TV channels.

Italian investigators looking into two British Virgin Island companies, Century One and Universal One, ised by Berlusconi to buy film rights and sell them on to Mediaset, Berlusconi's Italian media empire, focussed on money flowing through Swiss bank accounts, at Banca della Svizzera Italiana in Lugano, Switzerland. In particular, they wanted to trace where £35 million in cash went after being withdrawn from the accounts. , magnate indirectly to keep control of his media empire.

The latest news gets another angle from Corriere del Sera:

The most convincing evidence is a sort of confession made at an unsuspected time by Mr Mills, who is the husband of Tessa Jowell, the culture secretary in the Blair government, and whose house was searched by police again a week ago. That evidence comes from London, indirectly thanks to the Inland Revenue chasing income Mr Mills omitted to declare. To defend himself from the taxman’s demands, and the icy embarrassment of his partners, on 2 February Mr Mills made a written statement to his accountants giving his version of the "dividends and gifts from Mr Berlusconi and Fininvest", in which he attributed 600,000 dollars to a very special gift. It was made by Carlo Bernasconi, Mr Berlusconi’s late cousin and at that time in charge of Fininvest television rights, in compensation for the risks and business repercussions that Mr Mills claimed to have faced when giving evidence in Milan in December 1997 – at the trial for Finivest bribes paid to the Guardia di Finanza – and in January 1998 – at the All Iberian hearings on false accounting by Fininvest and illegal payments to Bettino Craxi.Mr Mills confirmed the contents of the letter during questioning in Milan on 18 July but then in November began to back-pedal in a memorandum to the public prosecutor’s office. He claimed he had made false statements in the letter to his accountants in order to evade the attentions of the UK tax authorities, and had invented the Berlusconi-Bernasconi connection for that reason. Why? Mr Mills wanted to conceal the true story behind the 600,000 dollars, which he claimed had passed through a managed client account in dealings involving three clients in particular, the shipowner Attanasio, convicted in Naples for bribery in the court of first instance, the businessman Paolo Marcucci and socialite Flavio Briatore. On questioning, all three contradicted Mr Mills, which may be the source of the incorrect reports in some newspapers that Mr Briatore had given evidence against Mr Berlusconi. The three witnessed realised the Mr Mills had been carrying out operations through their accounts without their knowledge.http://www.corriere.it/english/articoli/2006/02_Febbraio/17/ferrarella.shtml